EXHIBIT 10.1
MERGER TERMINATION
AGREEMENT
This Merger Termination Agreement
(this “Agreement”) is entered into as of June 27,
2005 by and among Nanometrics Incorporated, a California
corporation (“Parent”), Major League Merger
Corporation, a Minnesota corporation and wholly owned subsidiary of
Parent (“Merger Sub 1”), Minor League Merger
Corporation, a Delaware corporation and a wholly owned subsidiary
of Parent (“Merger Sub 2”) and August Technology
Corporation, a Minnesota corporation (the
“Company”).
RECITALS
A.
WHEREAS, Parent, Merger Sub 1,
Merger Sub 2 and the Company have entered into an Agreement and
Plan of Reorganization dated January 21, 2005 (the
“Merger Agreement”);
B.
WHEREAS, capitalized terms used but
not otherwise defined herein shall have the respective meanings
provided for such terms in the Merger Agreement;
C.
WHEREAS, Section 9.1(a) of
the Merger Agreement provides that Parent and the Company may
terminate the Merger Agreement at any time prior to the Acquisition
Merger Effective Time by mutual written consent duly authorized by
the Company Board and Parent Board;
D.
WHEREAS, Parent and the Company
intend to terminate the Merger Agreement effective upon the receipt
by Parent of the Company Termination Fee and all Expenses of
Parent; and
E.
WHEREAS, Parent Board and the
Company Board have each authorized the termination of the Merger
Agreement pursuant to the terms of this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of
the premises and the agreements set forth herein, the parties agree
as follows:
1.
Termination of Merger
Agreement.
Effective immediately upon receipt by Parent of the payment
described in Section 2(b) below, Parent, Merger Sub 1,
Merger Sub 2 and the Company hereby terminate the Merger Agreement
pursuant to Section 9.1(a) of the Merger Agreement by the
mutual consent of the parties thereto.
2.
Effect of Termination; Mutual
Discharge and Waiver.
(a) Except as expressly
provided in this Agreement, including Section 4 hereto, and
notwithstanding Section 9.2 of the Merger Agreement, as a
result of the termination of the Merger Agreement pursuant to this
Agreement, the Merger Agreement shall become void, and there
shall
be no liability under the Merger Agreement on
the part of any party hereto or any of their respective affiliates,
subsidiaries, directors, officers, shareholders, employees, agents,
financial and legal advisors and other representatives, and all
rights and obligations of each party thereto shall cease,
including, without limitation, the rights and obligations set forth
in Section 9.3 of the Merger Agreement and any liability for
the willful or intentional breach of any representations,
warranties, covenants or agreements contained herein.
(b) The Company shall pay to
Parent the Company Termination Fee ($8,300,000) and Expenses of
Parent ($2,600,000.00) on or before the first business day
following the date of this Agreement. Payment of the Company
Termination Fee and Expenses of Parent by the Company shall be made
by wire transfer of immediately available funds to the account
designated on Exhibit A hereto. In the event the
Company has paid the Termination Fee and Expenses by Wire Transfer
to the account designated on Exhibit A before the execution of
this Agreement, the Termination Fee and Expenses shall be deemed
received by Parent concurrently with the execution of this
Agreement. Parent acknowledges that payment of the
Termination Fee and Expenses shall constitute full and final
satisfaction of any and all obligations of the Company under
Section 9.3 of the Merger Agreement.
(c) Parent shall remit to the
Company, within two weeks following the date of this Agreement, the
amount, if any, by which $2,600,000 exceeds the actual Expenses of
Parent. If the actual Expenses of Parent exceed $2,600,000,
then Parent shall submit an invoice to the Company within two weeks
following the date of this Agreement. The Company shall
promptly reimburse Parent the amount of such invoice.
(d) Effective upon receipt by
Parent of the payment described in Section 2(b) above,
each party hereto, on behalf of itself and, to the extent permitted
by law, its affiliates, subsidiaries, directors, officers,
shareholders, employees, agents, financial and legal advisors and
other representatives, and the successors and assigns of each of
them (each, a “Releasing Party”), hereby releases each
other party hereto and each of their respective affiliates,
subsidiaries, directors, officers,
